Thursday May 13, 2010

I know the conventional wisdom is to “believe the betting markets, not the polls”, but it does beg the question of where the betting markets are getting their information.

I raise this on the back of the rather abrupt change in the Centrbet prices re the next Federal election. Labor had been around about a .72 chance of winning the 2010 election through March and April. The 49-51 Newspoll and a Nielsen poll close to that has seen that fall to a touch below .66 (1.42 to 2.75) over the course of about a week or so, with most of the fall coming within 36 hours of the Newspoll release. See the time series graph here.

This accords with some soaking-and-poking I did with the 2007 data, suggesting that Newspoll was the biggest mover of the betting markets.

By the way, Labor was as high as .82 (1.14 to 5.15) around the time of the LIberal leadership kerfuffle. And Labor was at .72 on the morning of the 2007 election.

And keep in mind the disjuncture between the current polls (asking the question “If an election were to be held today/this weekend…”), the question “Who do you think will win” and the betting market price. Current polls suggest a close election, or even a Coalition win; the “who do you think will win” question asked by Roy Morgan results in 61% saying they think Labor will win the next Federal election, the betting markets are not far off at .66, and tend to track the “who will win” proportion not too badly.

Saturday May 8, 2010

The Liberal Democrats, supported by the Electoral Reform Society, favor a type of proportional representation based on the so-called single transferable vote. Under that system, voters rank the candidates in order of preference. Votes for the lowest-ranking candidates are redistributed to the voterâ€™s second choice. The system is devised so that if a party wins, say, 25 percent of the vote, it should win 25 percent of the seats.

As any observer of Australian politics would tell you, that is not how Federal House of Representatives elections work. For example, the Greens won 7.8% of the House vote in 2007, but no seats. The Nats won 5.5% of the vote, but 10 of 150 seats (6.7%).

In 1990, the Australian Democrats won 11.3% of the vote, but zero seats.

The geographical distribution of party support still matters if you have a district-based system. STV doesn’t get you PR, at least not “automatically”, and its a misnomer to call STV a form of PR.